Technical Debt
Definition
The implied cost of future rework caused by choosing a faster, easier, or less thorough solution during software development instead of a better approach that would take longer. Technical debt accumulates interest in the form of increased maintenance costs, reduced development velocity, and higher defect rates. In software company valuations, high technical debt reduces the value of the technology intangible asset.
Related Terms
Related FAQ
What does it mean to be transparent about technology debt?
Technology debt—quick hacks, legacy code, unscaled infrastructure—should be acknowledged and itemized. Hiding it until post-acquisition acquisition is fraud.
Read full answer →How should companies account for AI infrastructure investments?
AI infrastructure investments — including GPU clusters, MLOps platforms, and data pipelines — are accounted for as either tangible assets (hardware), intangible assets (software platforms), or operating expenses depending on their nature and usefu...
Read full answer →Put this knowledge to work
Use Opagio's free tools to measure and grow the intangible assets that drive your business value.